ALPINE PCS, INC., Plaintiff-Appellant v. UNITED STATES, Defendant-Appellee
2017-1029
United States Court of Appeals for the Federal Circuit
January 2, 2018
Appeal from the United States Court of Federal Claims in No. 1:16-cv-00001-CFL, Judge Charles F. Lettow.
Decided: January 2, 2018
NORMAN PATTIS, The Pattis Law Firm, LLC, Bethany, CT, argued for plaintiff-appellant.
PATRICIA M. MCCARTHY, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, argued for defendant-appellee. Also represented by CHAD A. READLER, ROBERT E. KIRSCHMAN, JR.
Before MOORE, REYNA, and TARANTO, Circuit Judges.
In 1996, the Federal Communications Commission (FCC) awarded spectrum licenses to Alpine PCS, Inc., for use in the provision of wireless telecommunications services. Alpine‘s failure to make required payments for those licenses in 2002 triggered automatic cancellation of the licenses under FCC regulations. In addition to taking other steps in response, Alpine sought relief from the FCC and, on review under the Communications Act,
I
A
In May 1996, Alpine submitted bids in an FCC spectrum-license auction and won
As a small business, Alpine was eligible to pay its bid amounts in installments over the term of the licenses.
See
The notes contain two provisions highlighted by the parties. One describes the process of default:
A default under this Note (“Event of Default“) shall occur upon . . . non-payment by [Alpine] of any Principal or Interest on the due date as specified hereinabove if [Alpine] remains delinquent for more than 90 days and
(1) [Alpine] has not submitted a request, in writing, for a grace period or extension of payments, if any such grace period or extension of payments is provided for in the then-applicable orders and regulations of the Commission; or
(2) [Alpine] has submitted a request, in writing, for a grace period or extension of payments, if any such grace period or extension of payments is provided for in the then-applicable orders and regulations of the Commission, and following the expiration of the grant of such grace period or extension or upon denial of such a request for a grace period or extension, [Alpine] has not resumed payments . . . in accordance with the terms of this Note . . . .
J.A. 21-22; J.A. 29-30. A second provision states that the “Note[s] shall be governed by and construed in accordance with the Communications Act of 1934, as amended, the then-applicable orders and regulations of the Commis-
sion, and federal law . . ., and nothing in th[ese] Note[s] shall be deemed to release [Alpine] from compliance therewith.” J.A. 25; J.A. 33.
The security agreements incorporate the notes’ provisions regarding the process of default and identify automatic cancellation of the licenses as one of the FCC‘s remedies upon default. The security agreements also state that they “shall be governed by and construed in accordance with [the] Communications Act of 1934, as amended, then-applicable Commission orders and regulations, as amended, and federal law.” J.A. 42; J.A. 50.
The regulations in effect in September 1996 provided that a licensee “making installment payments . . . shall be in default” if a payment “is more than ninety (90) days delinquent,” but could “request that the [FCC] permit a three to six month grace period, during which no installment payments need be made.”
The FCC then amended the regulations, the amendments taking effect in 1998. See In re Amendment of Part 1 of the Commission‘s Rules – Competitive Bidding Procedures, 13 FCC Rcd. 374 (F.C.C. 1997); Celtronix Telemetry, Inc. v. FCC, 272 F.3d 585, 586 (D.C. Cir. 2001). The 1998 regulations, instead of requiring a
licensee will automatically be provided with a subsequent 90-day grace period,” and “[l]icensees shall not be required to submit any form of request in order to take advantage of the initial 90-day non-delinquency period and subsequent automatic 90-day grace period.“); see also 63 Fed. Reg. 2,315, 2,346 (Jan. 15, 1998), corrected by 63 Fed. Reg. 12,658, 12,659 (Mar. 16, 1998). But if the licensee did not pay the installment, plus late fees, after the second grace period, the licensee would be declared in default, have its licenses “automatically cancel[ed],” and be subject to debt collection.
In January 2002, Alpine failed to make its quarterly payment. Under the regulations in effect at that time, Alpine received two 3-month grace periods as a matter of course, and its new payment deadline was July 31, 2002. See
On July 24, 2002, a week before the deadline, Alpine asked the FCC to restructure the payment plan, invoking
In October 2002, a few months after the expiration of the grace periods, the FCC changed its public database to
show that the licenses had reverted to the FCC. According to Alpine‘s allegations in this case, however, the FCC assured Alpine that the database change was a clerical error, and the FCC continued to discuss possible payment restructuring with Alpine.
The FCC ultimately denied both the payment-restructuring and waiver-of-cancellation requests. On January 16, 2004, the FCC told Alpine that Alpine was in default and “advised Alpine that the Restructuring Request was being returned to Alpine ‘without action.‘” J.A. 14; see also In re Alpine PCS, Inc., 25 FCC Rcd. 469, 474 (F.C.C. Jan. 5, 2010). Three years later, on January 29, 2007, the FCC‘s Wireless Telecommunications Bureau issued an order denying Alpine‘s waiver and restructuring requests. In re Alpine, 22 FCC Rcd. at 1503 & n.2. Alpine timely filed a petition for reconsideration of the Bureau‘s decision, which the FCC denied on January 5, 2010. In re Alpine, 25 FCC Rcd. at 509 (citing
B
Several other events and proceedings are relevant here. On April 4, 2008, while Alpine‘s petition for reconsideration regarding waiver and restructuring was
In August 2008, Alpine filed for bankruptcy and moved for an automatic stay of the FCC auction. Debtor‘s Emergency Mot. to Enforce Automatic Stay, In re Alpine
PCS, Inc., No. 08-00543 (Bankr. D.D.C. Aug. 18, 2008). The bankruptcy court denied the stay motion, determining that the licenses were not part of the bankruptcy estate. In re Alpine PCS, Inc., No. 08-00543, 2008 WL 5076983, at *4 (Bankr. D.D.C. Oct. 10, 2008), aff‘d, 404 F. App‘x 504 (D.C. Cir. 2010). The FCC re-auctioned the licenses in 2008.
In January 2013, Alpine sued the FCC in the U.S. District Court for the District of Columbia, alleging breach of contract, unjust enrichment, fraud in the inducement, and breach of fiduciary duty, and seeking declaratory judgments of no default and no debt. Compl., Alpine PCS, Inc. v. FCC, No. 1:13-cv-000006, at 8-11 (D.D.C. Jan. 3, 2013). Alpine argued that the case was properly before that court because the promissory notes include a forum-selection clause stating that “any legal action or proceeding relating to th[e] note[s], the security agreement[s], or other document[s] evidencing or securing the debt transaction evidenced hereby may only be brought in the United States District Court for the District of Columbia.” J.A. 24; J.A. 32. The district court rejected Alpine‘s argument and dismissed the claim for lack of jurisdiction, concluding, among other things, that the contract claims were essentially an attack on an FCC licensing decision, review of which is committed by statute,
C
On January 4, 2016, Alpine brought the present action against the United States in the Court of Federal Claims. Alpine alleged breach of oral and written contract, breach of contract implied in fact, and breach of the duty of good faith and fair dealing (the contract claims). According to Alpine, the FCC breached its contractual
obligations under the notes and security agreements and breached its duty of good faith and fair dealing by automatically canceling Alpine‘s licenses after the two grace periods, as provided in the amended regulations (described above). Alpine also asserted a constitutional claim under the Fifth Amendment (the takings claim) based on the FCC‘s alleged regulatory taking of property in canceling the licenses under the amended regulations, for which Alpine was seeking just compensation.2
The government moved to dismiss the case for lack of jurisdiction: it argued that the claims, filed in 2016, were untimely under the six-year statute of limitations,
This appeal followed. We have jurisdiction pursuant to
II
A
We review de novo the court‘s dismissal of claims for lack of subject-matter jurisdiction under the Tucker Act. Folden v. United States, 379 F.3d 1344, 1354 (Fed. Cir. 2004).
As relevant here, the Tucker Act waives sovereign immunity for, and provides for Court of Federal Claims jurisdiction over, monetary claims against the United States “founded [] upon the Constitution . . . or upon any express or implied contract with the United States.”
The Supreme Court, however, has described the Tucker Act as serving a “gap-filling role” by allowing “for an action against the United States for the breach of monetary obligations not otherwise judicially enforceable.” United States v. Bormes, 568 U.S. 6, 12-13 (2012) (footnote omitted). In accordance with that characterization, the Court has held that the Tucker Act does not apply in various circumstances in which Congress has provided “a precisely drawn, detailed statute” that “contains its own judicial remedies.” Id. at 12 (internal quotation marks omitted). Where it has found those circumstances, the Court has held that the “specific remedial scheme establishes the exclusive framework for the liability Congress created under the statute” and “displace[s]” the Tucker Act. Id.
The Court has found such circumstances in a number of cases. See, e.g., Horne v. Dep‘t of Agriculture, 569 U.S. 513, 526-28 (2013) (holding that Agricultural Marketing Agreement Act of 1937 displaces Tucker Act); United States v. Fausto, 484 U.S. 439, 454-55 (1988) (holding that the Civil Service Reform Act, which “established a
comprehensive system for reviewing personnel action taken against federal employees” and which “deliberate[ly] exclu[ded] employees in respondent‘s service category from the provisions establishing administrative and judicial review for personnel action of the sort at issue here,” displaces Tucker Act jurisdiction over claims based on such personnel actions under the Back Pay Act); United States v. Erika, Inc., 456 U.S. 201, 208 (1982) (holding that Tucker Act jurisdiction over certain claims involving Medicare Part B payment decisions was displaced by “precisely drawn provisions” of the Medicare statute); Brown v. Gen. Servs. Admin., 425 U.S. 820, 834-35 & n.10 (1976) (“precisely drawn, detailed statute” of Section 717 of the Civil Rights Act of 1964 provides the exclusive judicial remedy for claims of racial discrimination against the government, withdrawing jurisdiction under Tucker Act).
This court has drawn the same conclusion in several cases, recognizing that “[w]hen such a ‘specific and comprehensive scheme for administrative and judicial review’ is provided by Congress, the Court
which that process was unavailable, did not arise under the Medicare Act and hence remained within Tucker Act).
B
The Court of Federal Claims concluded that Tucker Act jurisdiction over Alpine‘s contract claims is displaced by the comprehensive scheme for review provided in the Communications Act of 1934. We agree.
“To determine whether a statutory scheme displaces Tucker Act jurisdiction, a court must ‘examin[e] the purpose of the [statute], the entirety of its text, and the structure of review that it establishes.‘” Horne, 569 U.S. at 527 (quoting Fausto, 484 U.S. at 444). In Horne, the Court determined that the Agricultural Marketing Agreement Act of 1937 provided mechanisms by which handlers could file a petition directly “challeng[ing] the content, applicability, and enforcement of marketing orders..., including constitutional challenges, in administrative proceedings.” Id. (citing
In Folden, we examined in detail the Communication Act‘s “comprehensive statutory and regulatory regime governing orders of the [FCC],” including the remedial scheme of administrative review under
FCC decisions and orders falling within
Here, the key question is whether Alpine‘s contract claims fall within
The D.C. Circuit came to the same conclusion in 2014. That court affirmed a district court order dismissing for lack of jurisdiction the same contract claims we now have before us. The D.C. Circuit explained: “Although camouflaged as a contractual dispute, Alpine‘s suit really challenges the FCC‘s decision to ‘revoke’ the
Alpine contends that it is not challenging the revocation of its licenses, but rather “the breach of a contract that resulted in forfeiture of [the] licenses.” Alpine Reply Br. 9. That distinction is an empty one. Subsection
Alpine also argues that its contract claims are not within the scope of
Alpine itself, between 2002 and 2010, took advantage of the Communications Act‘s administrative and judicial remedies and raised its contract claims before the FCC and the D.C. Circuit. When the applicable regulations threatened cancellation of the licenses in the summer of 2002, Alpine filed administrative requests for waiver of those regulations and restructuring of the payment plan. After the Wireless Communications Bureau denied those requests, Alpine filed a petition for reconsideration by the FCC, arguing, among other things, that the FCC “breached fiduciary duties owed to Alpine,” including “a duty of candor and good faith.” In re Alpine, 25 FCC Rcd. at 506-07. The FCC denied the petition, and Alpine proceeded to the next step in the remedial scheme—review by the D.C. Circuit. There, Alpine argued that the FCC breached its contractual obligations under the notes
and that “the FCC violated the implied covenant of good faith [and fair dealing].” Final Br. of Appellant Alpine PCS, Inc., Alpine PCS, Inc. v. FCC, No. 10-1020, 2010 WL 3253656, at *32, *35 (D.C. Cir. June 3, 2010). Alpine asserted that the D.C. Circuit had “jurisdiction to hear Alpine‘s appeal pursuant to
We hold that Alpine‘s contract claims fall within the exclusive jurisdiction of the
C
We also hold that the same conclusion applies to Alpine‘s takings claim: Tucker Act jurisdiction over the claim is displaced by the Communications Act. The Court of Federal Claims did not dismiss the takings claim on this basis, and the government does not argue for lack of jurisdiction on this particular ground. But we are independently obliged to consider defects in the trial court‘s jurisdiction, even when not raised by the parties. See, e.g., Gonzalez v. Thaler, 565 U.S. 134, 141 (2012) (“When a requirement goes to subject-matter jurisdiction, courts are obligated to consider sua sponte issues that the parties have disclaimed or have not presented.“); United States v. Cotton, 535 U.S. 625, 630 (2002); Mitchell v. Maurer, 293 U.S. 237, 244 (1934). And the Supreme Court has confirmed that federal courts have discretion to choose which among several possible jurisdictional (or even certain non-jurisdictional threshold) issues to decide. See Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 584-85 (1999); see also, e.g., Law Offices of David Efron v. Matthews & Fullmer Law Firm, 782 F.3d 46, 51 (1st Cir. 2015). In this case, reaching the displacement issue is particularly justified for at least two reasons taken to-
gether: first, the displacement issue is more straightforward than the timeliness issue, especially given that we have already analyzed the issue for the contract claims; second, the government‘s brief argument in support of the timeliness ground relies centrally on a decision, Soriano v. United States, 352 U.S. 270 (1957), that itself leads to the inquiry into whether another statutory regime displaces the Tucker Act. Id. at 274-75 (holding that accrual of takings claim was not postponed by the availability of an Army Claims Service remedy where Congress “ha[d] not so restricted the jurisdiction of the Court of Claims“).
Alpine‘s takings theory is that the licenses are property for purposes of the Takings Clause and that the FCC‘s cancellation of the licenses resulted, at some point, in a taking for which Alpine was due just compensation. In this court, the judgment on appeal is a dismissal for lack of jurisdiction, not on the merits. And the government, in its brief as appellee, has not contested Alpine‘s premise, which the Court of Federal Claims endorsed, that the licenses are property protected by the Takings Clause. Alpine PCS, 128 Fed. Cl. at 308-09. We take the premise as a given (without deciding whether it is correct) for purposes of assessing the jurisdictional issue.
What the parties have contested in their briefs is when any taking at issue occurred and gave rise to a claim for just compensation under the Tucker Act. The government contends that the claim accrued before January 4, 2010—making the complaint in this case, filed on January 4, 2016, out-of-time under the six-year statute of limitations. In particular, the government contends that the alleged taking occurred at one or more of the following times: when the FCC canceled the licenses in 2002; when the FCC informed Alpine that Alpine was in default and that no action would be taken on the restructuring request in 2004; when the FCC Wireless Telecommunications Bureau denied Alpine‘s waiver and restructuring
requests in 2007; or when the FCC re-auctioned the
Alpine, on the other hand, contends that the alleged taking did not occur, and the claim did not accrue, until January 5, 2010, when the FCC reached a final decision not to waive the automatic cancellation provision of the amended regulations. Alpine relies on Supreme Court decisions that have articulated two “ripeness” requirements applicable to certain regulatory takings claims (against state or local government entities): a sufficiently definitive decision about the injury to the complainant‘s property from the government entity alleged to have committed the taking; and a sufficiently definitive denial of just compensation for such a taking. See, e.g., Palazzolo v. Rhode Island, 533 U.S. 606, 618-26 (2001); Suitum v. Tahoe Reg‘l Planning Agency, 520 U.S. 725, 733-34 (1997); Williamson Cty. Reg‘l Planning Comm‘n v. Hamilton Bank of Johnson City, 473 U.S. 172, 186, 194 (1985). The Court has also discussed the Williamson County-based ripeness requirements in Horne, 569 U.S. at 525-26, a case involving the federal government. The parties here dispute the scope of those decisions and whether and how they apply in this case to identifying the accrual date of a claim for Tucker Act compensation, notwithstanding the availability of relief from the FCC and the FCC‘s final denial of such relief on January 5, 2010.
The government relies for its pre-2010-accrual argument on the Supreme Court‘s decision in Soriano—which the cited Williamson County line of cases does not discuss. The Court in Soriano held that a Tucker Act claim for just compensation accrued at the time of a war-time requisition of material from the plaintiff (by Philippine Army units assertedly acting under the authority of the U.S. Army), whether or not the plaintiff had yet sought com-
pensation from another government entity, the Army Claims Service. 352 U.S. at 274-75. The Court stated as its ultimately decisive rationale that Congress “has not so restricted the jurisdiction of the Court of Claims” to hear a just-compensation claim for a completed taking based on the availability of a potential other avenue of relief. Id.
Soriano thus suggests that, even to decide the timeliness issue in the way the government has argued it, we would have to examine whether the Communications Act remedy displaces Tucker Act jurisdiction for the governmental action challenged as a taking here. In any event, an examination of that question leads to a conclusion of no jurisdiction in this case without routing that conclusion through a determination regarding timeliness. Just as we concluded that the Communications Act displaces Tucker Act jurisdiction over Alpine‘s contract claims, we conclude that, as relevant to Alpine‘s quest for relief under the Takings Clause, the Communications Act provides “a ready avenue to bring [a] takings claim” and “withdraws Tucker Act jurisdiction.” Horne, 569 U.S. at 527-28. Finding such displacement of Tucker Act jurisdiction, we need not further explore the timeliness issue.
There is no disagreement between the parties about the proposition that the FCC had the power to grant Alpine adequate relief, by eliminating the taking, providing compensation, or some combination. Thus, Alpine insists that the FCC could have done the following:
forgiven any amounts still owing on the licenses, concluded that Alpine was entitled
to a refund of some or all the amounts it had already paid, provided equivalent spectrum or other compensation to the holder of the spectrum [after re-auction] and awarded the [original] spectrum to Alpine, awarded Alpine licenses of equivalent value, provided Alpine with a voucher representing the
amount to which Alpine was entitled and permitting the value of the voucher to be used or assigned to third parties in future spectrum auctions to acquire alternative spectrum, or taken any number of other remedial steps had it concluded that the [Wireless Telecommunications] Bureau decision was erroneous.
Alpine Br. 24. The government, for its part, has not denied that the FCC could have provided Alpine adequate relief.3 Significantly, compensation in a form other than monetary damages can be constitutionally adequate. See Reg‘l Rail Reorg. Act Cases, 419 U.S. 102, 150-51 (1984) (“No decision of this Court holds that compensation other than money is an inadequate form of compensation under eminent domain statutes.“). The displacement question before us therefore is limited to a situation in which the parties do not dispute the adequacy of the non-Tucker Act remedial regime both to adjudicate the takings claim and, if a taking is found, to provide the constitutionally required relief (by curing the taking, providing just compensation, or some combination).
The Communications Act, including
agency level, there was no procedural impediment to Alpine‘s presenting a takings claim to the FCC. The FCC did not suggest that it lacked the authority to review the license cancellation and take steps to provide compensation. See generally In re Alpine, 25 FCC Rcd. 469 (FCC review of Alpine‘s requests to waive the automatic cancellation rule and to restructure the payment plan); see also In re Alpine, 22 FCC Rcd. 1492 (Wireless Telecommunications Bureau review of Alpine‘s requests). Nor would Alpine‘s takings claim have been futile in agency proceedings; for example, Alpine‘s claim would not have required the FCC to question the constitutionality of a statute. See Weinberger v. Salfi, 422 U.S. 749, 765 (1975) (noting general rule against agency authority to deem statutes unconstitutional). And the FCC is generally under an obligation not to take action contrary to the Constitution and to hear properly presented constitutional claims. See
In any event, the judicial review scheme under the Communications Act
attention of the appellate court errors of law in the action of the [FCC] in granting [or revoking] the license.” F.C.C. v. Sanders Bros. Radio Station, 309 U.S. 470, 477 (1940); see also Clarke v. Sec. Indus. Ass‘n, 479 U.S. 388, 394 n.8 (1987) (noting that
Under the comprehensive statutory scheme, then, Alpine could have raised a constitutional takings claim; the FCC had the authority to grant relief; and the D.C. Circuit had jurisdiction to review whether a taking occurred and, if so, whether the FCC decision “yield[ed] just compensation.” Williamson Cty., 473 U.S. at 194. The statutory scheme thus affords Alpine “a ready avenue” to bring its takings claim and displaces Tucker Act jurisdiction over that claim. Horne, 569 U.S. at 527-28. This conclusion, though statute-specific, accords with similar conclusions we have reached under other statutes. E.g., Innovair Aviation Ltd. v. United States, 632 F.3d 1336, 1342-43 (Fed. Cir. 2011) (holding that Tucker Act jurisdiction over takings claim based on forfeiture of property seized pursuant to
Controlled Substances Act‘s scheme for administrative and judicial review) (citing Vereda, 271 F.3d at 1375 (same)); Lion Raisins, Inc. v. United States, 416 F.3d 1356, 1370, 1372-73 (Fed. Cir. 2005) (affirming dismissal of takings claim for lack of jurisdiction under the Tucker Act because the “administrative and judicial review procedures available under
III
For the foregoing reasons, we affirm the judgment of the Court of Federal Claims.
AFFIRMED